Bosnia and Herzegovina, including the Republic of Srpska, has significant natural resources that could enable it to become an important player in the renewable energy sector in the region. However, unresolved market challenges are increasingly putting this opportunity at risk, according to an association of renewable energy producers.
The association highlights that strong potential in solar and hydropower could serve as a solid foundation for sector growth, increased exports, and new investments. Despite this, producers are facing growing difficulties in selling electricity under sustainable market conditions.
One of the key issues in recent months has been a sharp decline in electricity purchase prices, particularly during periods of high solar generation. Additional concerns include the lack of stable long-term agreements such as PPAs (power purchase agreements), an underdeveloped electricity market, the absence of a fully functional electricity exchange, and limited balancing and storage capacities.
These challenges are not only reducing the economic viability of existing renewable energy projects but are also discouraging new investments at a time when the sector should be expanding rapidly.
The association stresses that the most urgent priority is the establishment of a transparent and well-structured electricity market, including the launch of a functional exchange platform. It also calls for the introduction of long-term contracting mechanisms to ensure more predictable revenue streams for renewable energy producers.
Furthermore, the development of energy storage solutions, particularly battery systems, is seen as essential for absorbing excess generation and mitigating the impact of oversupply during peak renewable output.
The group also urges regulators and institutions to take a more active role in protecting domestic investments and creating a more predictable and stable business environment for project developers.
Without progress in these areas, Bosnia and Herzegovina risks leaving much of its renewable potential untapped and missing the opportunity to establish itself as a regional leader in clean energy.
